Maple Leaf Foods Announces Major Restructuring
Maple Leaf Foods announced today significant changes in prepared meats business operations. Hoping to reduce operating costs and increase productivity, Maple Leaf Foods plans to invest $560 million in its infrastructure and technologies over the next three years.
Maple Leaf Foods is hoping to become more competitive. Implying that it will create a world-class prepared meats network, many changes are coming to company operations. Part of this initiative is its facility investment plans which include a construction of a new $395 million, 402,000 square foot prepared meats facility in Hamilton, Ontario.
Other Maple Leaf Foods plants will also see investment and expansion. These include the already existing facilities in Winnipeg, Saskatoon and Brampton. Maple Leaf is hoping to re-establish these facilities into highly efficient, category focused “centres of excellence.”
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On the other hand, Maple Leaf Foods is also planning on closing facilities to consolidate operations. Plants located in North Battleford, Kitchener, Hamilton, Toronto, Moncton and a small facility in Winnepeg are expected to shut down by the end of 2014.
Maple Leaf Foods expects this business restructure plan to create a more valuable company and expects the costs of this plan to reach approximately $170 million before taxes.
"The final phase of this plan will establish Maple Leaf Foods as a more streamlined and profitable company, well positioned to deliver significant and sustainable value to its shareholders," said Michael H. McCain, President and CEO. "We are creating, through one of the largest single investments in the Canadian food industry, a highly efficient, world-class prepared meats production and distribution network that will markedly increase our competitiveness and close the cost gap with our U.S. peers."
